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Firestone Diamonds Raises $6M for Liqhobong Development

Jul 16, 2013 4:37 AM   By Deena Taylor
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RAPAPORT... Firestone Diamonds has raised $6 million (GBP 3.97 million) through a  private  placement. The funds will be used for working capital purposes and further development at its flagship Liqhobong mine in Lesotho, as well as for debt repayment, the company reported.

Firestone placed 198.5 million new ordinary shares in the company through Mirabaud Securities LLP and a direct subscription with institutional and other investors, as well as certain existing shareholders at a price of 2 pence per share.

In October 2012, Firestone reported that it would need an initial expenditure of $167 million to develop the main treatment plant at Liqhobong. As additional funding is still required to fund the plant, the company is currently pursuing a number of additional funding alternatives. Firestone expects to close these other financing initiatives during the fourth quarter of 2013, which will provide the company with sufficient capital to fully develop and implement the development. Once operational, the treatment plant is expected to produce approximately 1 million carats per year.

To date, the pilot plant at Liqhobong has produced 274,577 carats since production began in September 2011. Diamonds form the plant achieved an average price of $86 per carat in the 12-month period that ended in May 2013. However, the board expects to discontinue the plant before the end of the year in order to prepare the mine for the development of the new plant.

In addition, the company said that it has identified relevant candidates to strengthen its executive team and assist the group in implementing its strategy, and to oversee development of the treatment plant.

Firestone owns a 75 percent stake in the Liqhobong mine with the remaining 25 percent held by the government of Lesotho. 
Tags: Deena Taylor, Firestone Diamonds, Liqhobong mine
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